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Marjorie Hernandez, Co-Founder Of Lukso On Supporting the Digital Economy Of The Multiverse, Plus: DKNY NFT, Opensea's Surprisingly Small Team, And More...
Luxury isn’t something you typically associate with blockchains and NFTs. Lukso is working to change that perception. In this episode, Eathan Janney, Jeff Kelley & Josh Kriger interview Marjorie Hernandez , cofounder of the digital lifestyle blockchain platform. Marjorie talks about how Lukso was conceptualized and how the concept of luxury brands will change with the advent of blockchains and NFTs. Tune in as we learn more about the digital lifestyle today.
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Marjorie Hernandez, Co-Founder Of Lukso On Supporting the Digital Economy Of The Multiverse, Plus: DKNY NFT, Opensea’s Surprisingly Small Team, And More…
This episode features Marjorie Hernandez, Cofounder of LUKSO, the blockchain for a new digital lifestyle at the intersection of digital and physical goods. Marjorie is a multifaceted design and innovation expert, equal parts entrepreneur and designer. She has supported organizations across Europe to outward latent unmet needs into holistic experiences around them.
**An architect and designer by training, Marjorie spent most of her professional career creating ideas and concepts for her clients, ranging from well-known artists and creative agencies to one of the big four accounting firms. As the digital transformation and strategy executive, Hernandez collaborated closely with Ethereum and the Iota Foundation. She takes special interests in the confluence of design and tech, as well as in which ways those can be used to promote well-being and create new business models. Marjorie also cofounded THE DEMATERIALISED, powered by LUKSO, an experimental marketplace for fashion NFTs. Marjorie is a transformational leader in blockchain tech and fashion. We are lucky to have her here to chat with us. **
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Marjorie, welcome.
Thank you. That was well done. Thank you for having me.
That’s because of your impressive background. Great having you here.
You’re in the fashion industry. You know how starting off with the right look is important to having a great day.
That’s true. I agree. The outside forms the inside and vice versa.
We’re pumped to hear about what you’re doing, what you’re up to with LUKSO and everything that that you can share with us. We wanted to start at the beginning and learn a little bit more about your first exposure to NFTs. What was that experience like? Was it something where you knew right away this was going to be the path for you or was it more of a slow burn?
I wouldn’t say it was super-fast since the beginning but I was intrigued since the first time I heard about NFTs. It was the CryptoPunks and then the next time I heard about it was with the CryptoKitties. That was, back then for the Ethereum community, a super big moment. It was like, “The Ethereum network is full. It’s super challenging. There’s no transaction right now because everybody was breeding CryptoKitties.” That gave all of us a taste of how blockchain technology will look.
We all knew it’s going to impact many industries but it wasn’t clear how those experiences are going to be, which products are going to be first. That gave us the first taste of like, “This is what it would be like for a regular consumer or buying a regular asset using blockchain technology that is not trading, speculating doing all of that stuff.” I was immediately intrigued. I knew it was the beginning of something but as time evolved, I got more fascinated about the thing. By 2017, I was sure that this is it.
One of the interesting things early on was so much of it was about trading and collectibles and the full spectrum of possibilities around NFTs wasn’t that evident or wasn’t that talked about. It was that transition, at least for me personally, that was massive. It was mind-blowing. When I realized, “This can be used for more than collectibles or nostalgic items,” which is a huge market. It has a big place here. There’s much more to this.
It begs the question, when specifically did the LUKSO concept come together?
Me and my cofounder, Fabian, went to university together in Germany. Since then, we have always collaborated on all kinds of projects, data projects in the university. We teamed together and did a bunch of stuff together. When we started working, each one of us was on our own path. Fabian became part of the Ethereum Foundation. I was doing a strategy and consultancy in Germany and Switzerland.
Luxury Blockchain: There’s some understanding about the value of digital goods. We are all observing these because even if we’re not that old, we want to bond with it.
One of the many nights, we’re always talking and thinking about what it will be to create the tools because he had done ERC-20 at that point in time. It was at the moment that we were starting to get this mass adoption around ERC-20. It became super evident how when you standardize certain pieces in the smart contract that you can create this network effect of, all of a sudden, having adoption by an unlimited amount of people.
At that point, we decided, “What would it be like if we created tools and applications that will power creators of culture to enter the blockchain space? How will it be if we have the ability to tokenize cultural goods or consumer goods in a simple way and have the same ability to scale and monetizing as people had with ERC-20?” That was the beginning of it. That was in 2017. At that point in time, we were both having our respective jobs. By the end of 2017, we were convinced with the idea of moving forward and putting those thoughts into LUKSO.
It’s interesting because we often talk about the Edge of NFT as the intersection of technology and culture. When you look at what’s happened now, you’re pioneers and ahead of your time because that is the conversation. When people ask, “Why are NFT is selling for thousands or hundreds of thousands or millions of dollars?” It has to do with this intangible around technology and culture. How do you describe that to people because it’s hard for you to grasp like, “What’s going on here?”
First of all, it goes to the immateriality, intangibility and dematerialization of the good itself. Including us, we come from a world in which you invest your money in things that you can see and touch. People have a challenge more around the lack of materiality of this course. Even if we have a physical counterpart, the challenge goes upon those things.
We all understand that the value of things is more than the sum of its parts. It’s not always related to physicality. The value of the Mona Lisa is not the canvas and the painting. It’s all of these things around it. Blockchain technology and all of these digital goods, what make this tangible and make it easy for a creator or an artist to basically be able to capture that value and to see the results of it immediately.
I don’t think it’s a foreign process. I don’t think it’s a process that is not related to how culture has worked but all of a sudden, we have it at a bigger scale, like these hype cycles becoming more evident. The thing around scarcity is the whole NFT world is like a Supreme shop 24/7. This is always demanding lines and people seeing and playing with dynamics that come up with the hype cycle.
We will have some of the hype cycles but maybe it’s a different conversation we can have. Eventually, we will have a little bit of normalization around consumption. This is something that I look forward to. This is not about the hype and the crazy prices and how many millions per one NFT but it’s that daily consumption of every digital good that gets purchased on the internet. The metaverse is happening over effectively NFTs.
I totally understand. I’m thinking about our social media coordinator who tries to take a quote from each episode and turned it into a graphic and you’ve given her a lot to work with. We could check that box.
You’ve talked a lot about your enthusiasm for what’s going on with NFTs and consumer goods and things like that. You were chatting with us about how friends of yours in the business world were saying, “Why didn’t you do something in DeFi?” You have a serious background, the ability to do something that’s not so engaged with typically fun, entertaining and consumer-based things necessarily. Why do you think you picked that? What was your answer to people when they were asking you why you chose this instead of a DeFi project?
First of all, from a personal interest perspective, Fabian and I met at design school. Prior to that, I had studied architecture so my personal interest is in cultural and cultural goods. All of the DeFi protocols are fascinating as they are. If there’s not a real economy around them, they become self-serving. We have our bank accounts, credit cards and all of this stuff but we have them for what? We want to buy cool stuff. That’s the end game.
We all want to be able to afford cool stuff that we like. That cool stuff for me and everybody who’s younger than me, especially, it mostly tends to be a digital good or a good that has a digital representation as well. At that moment in time, we thought this is the biggest transformation of our time. It is the dematerialization of consumption that can be powered by blockchain technology.
Everybody was thinking about DeFi protocols because of all of the money that was being generated but when it comes to real mainstream adoption, we are all more excited about owning cool stuff that we like than being stakeholders in some DeFi protocol. That’s cool and all but what passions most people is cultural interaction or consumer interaction. It’s how we started but it was funny back then especially for Fabian more than me. “You’re a serious guy with the ERC-20. Why are you into sneakers or whatever?” People thought at the time. We do something with DeFi but we both had a passion for culture and technology. It was a no-brainer for us.
This sounds like distant history, how long ago were people asking you these questions and have these conversations?
At the beginning of 2017 when we started thinking about that, I would tell people and I will go to my friends in fashion and artists. They were all super excited. They were like, “I don’t understand what you’re saying but it sounds like it could be the future.” Our friends and contacts from the blockchain space were always quite skeptical but it changed.
What was the moment that everyone got it? Was it when you guys collaborated with Chanel? Was there a particular drop that you did where everyone was like, “This makes sense?”
We did collaborate with Chanel. We have two advisers from Chanel. The most recent and most relevant one is Eric Pfrunder, who was with Chanel for over 37 years and was the image director. He and Karl Lagerfeld work hand-in-hand. It was a creative marriage. Eric, we met and I told him that story several times. He told me, “Karl would have been fascinated by this. He would have been the first person to jump into this wagon of technology because Karl was fond of technology. It was something that he liked.” When you have a person like him with all of his heritage and all of his cultural values, it validates for a lot of people.
In the general perception of LUKSO, people have started changing. They were in lockdown and they start realizing they might be up to something when they keep talking about the dematerialization of goods and spending a lot of time in virtual environments. When everybody was in confinement, it was like, “This makes sense. We all need these avenues of consumption that are not physical ones.” Definitely, these are things that we have achieved through our network and the business development activities and our advisory board, who have definitely complex support of an argument.
It’s interesting how the quarantine and the virus accelerated and influenced a lot of this stuff and made it real and tangible for folks. I have been working on virtual projects since the same time around 2017. I had a lot of people scratching their heads and then jumping on board around 2019. As we get back into travel too, there’s an idea that people can get out of their houses and get out of the digital world so maybe they’re not going to care as much. Interestingly enough, if you look at me, I’m traveling to Los Angeles to go visit Josh so we can work on our episodes about NFTs.
For example, for the basic stuff, I use my son as my research. You also get inspired by the stuff that he’s interested in because he’s the consumer of the future. For the last few years, he has not asked for anything that is physical besides hardware. Everything he wants to buy is digital. He’s always in Discord with his friends. During the lockdown, they were all the time on Discord, hanging out together.
They do these parties and then they make the slang to buy the Gucci Roblox drop. They were screaming at the top of their lungs with their excitement for this good. I take Joshua anywhere. He’s being all over the world in any type of city. He likes it. He enjoys it. He appreciates it. He likes seeing the architecture and the art but he doesn’t want to buy anything. I take him into shops and say, “What do you want?” He’s like, “Nothing.”
His grandmother gave him €50 for his birthday. He shows me the money. He’s like, “What can I do with this?” I was like, “Don’t worry. Give it to me and then you can use it from my credit card.” He’s always trying to mine crypto and all of this stuff. He understands it. It’s not only him but so many of his friends are the same. That’s something interesting.
There’s a generational shift. There’s also a different understanding of the value of digital goods. We are all observing these almost as anthropologists because even if we’re not that old, we weren’t born with it. We weren’t born looking into an iPhone. This was sci-fi for us. We’re still trying to understand a phenomenon that is still slightly outside of our initial nature but for these guys, this is the built environment. This is how it is. It’s been part of their life since the beginning. There is an understanding and appreciation for the digital good that is as real and as important as anything else. If not, even more.
“Grandma, you don’t have a MetaMask? Grandma, what are you doing?”
Joshua will prefer like, “Do you want to get this Rolex for your eighteenth birthday? Do you want a Bitcoin?” He will tell you that he prefers that Bitcoin.
What a world. It’s amazing. We haven’t given folks the goods on LUKSO yet. Tell them what LUKSO is, why it’s important to the space and a little bit more about the platform.
Luxury Blockchain: People who into fashion trends love the digital stuff, but they get intimidated by the whole crypto scene.
Our team’s mission is to demystify and make it simple for creators and users to utilize and interact with blockchain technology. That’s the core premise. We wanted to make it super simple for anyone to be able to issue, manage and control their NFTs or whatever type of digital goods they might own. That was the main premise of LUKSO.
When we started, we have our own network which is an Ethereum sister chain. For us, it is super important to remain compatible with Ethereum. We’re putting most of our time in our research and development time and Fabian’s time into standardizing the core pieces that we think are super important parts to create an ecosystem.
We came down to the key component which is the identity of the user, creator and identities for the products. We have created this complex matrix of established smart contract standards in order to enable different types of interaction and different types of NFTs to exist. The main tool being something that we call universal profile, which is supposed to represent your own chain profile. It is supposed to have nothing to do with your hard identity. It’s your own chain profile where you effectively will issue and receive NFTs.
That identifier is the place where you can go and verify, “This was issued by Virgil Abloh, Chanel or Joshua,” and then from there, they start going into the market and transporting, etc. We are taking the complexity away from it. The key management and all of that stuff have been simplified tremendously. We see that as the key component that is necessary in order to have that mainstream adoption of blockchain tech.
This is something that we test extensively on my second venture with THE DEMATERIALISED, which is a digital fashion marketplace. We are targeting regular fashion consumers, people who love fashion, who are into trends and love the digital stuff but they get intimidated by the whole crypto scene. They come to our website and issue in the profile. It is super simple. They can purchase in a very seamless fashion. We transfer the ownership all in the background and then they can manage the profiles. It’s easy in the same way you manage any of your social media accounts.
With DEMATERIALISED, is this digital-only or digital and physical or a mix of both?
It’s meant to be digital-only. We did a drop with one physical garment. It was cool because the designer was conceptual and smart. Her name is Gala from TRIBUTE BRAND. What we had on the side was an NFT with an audio file of her describing the product and a picture of the texture of the product that she was going to use. It was one of a kind because it was made for the person who bought it. We have these moments in which we might go for physical but we prefer to remain digital.
Taking a step back, you’ve been a pioneer in this space. What do you see is the future of Web 3.0 consumer consumption? What challenges do we need to solve along the way? What’s coming down the pike?
There are still a lot of problems that LUKSO is solving and the other companies are solving that people have not realized yet their problems. Once people start realizing all of the money they were giving into buying skills in games and all of the money we’re investing online, we are not buying anything. We are just gaining access. We’re paying for the right to access a specific thing. Once a person realizes you’re not owning a thing, that consumer needs of, “If I’m going to give you my money, I want to own something. I want to have access regardless of your platform. Regardless if you still are in business in ten years or if you don’t like me anymore and you want to blacklist me, I want to own my stuff.”
Once that consumer is going to come at this, it’s going to come super soon. A lot of the things that we have are the most of the things that you can buy and what you consume online are in some form or another NFT or a token. It would be the means of consumption in the future of the internet on the metaverse. It is going to be some blockchain assets. That’s the future. How do we get to make it easier? The user journey has to be simplified. It comes down to that. It is something that needs to happen like MetaMask and all of those steps. They’re massive barriers of entry. I know a lot of people get intimidated. A lot of women get intimidated so we need to simplify that.
That’s something that LUKSO is proposing. It’s the absolute killer application that we’re doing with universal profiles and something that could be implemented in Etherium as well because we are going to publish everything open source. Having that ability to have your own chain profile and that being your profile that you 100% control, where your ownership and identity are sitting. From there, you have the access to different applications and games, etc.
Will that Onchain profile work across chains? Now, there are NFTs on MATIC, Solana, BMB or Binance Smart Chain. Is that the goal?
Creativity is our number one asset as humans.
I could make NFT selling homeworks.
I bought a Bottega Veneta handbag.
I’m not familiar with that.
She’s good at lying too.
It’s not true. It’s your personal style.
That’s so special.
Communicating is good.
All this stuff is right around the corner.
Imagine them all in nice outfits.
That’s great advice.
When we launched Edge of NFT probably.
Is DEMATERIALISED the same?
Important Links:
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LinkedIn – Marjorie Hernandez
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Alts Anonymous – Twitter
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Dennis Lisk – LinkedIn
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OpenSea’s team of 37 staff is currently handling 98% of combined NFT volumes – article by Cointelegraph
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Rolexes and Lamborghinis are so yesterday. NFTs are the new digital flex – article by Fortune
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Clubhouse – @JoshKriger
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DKNY to Auction Its First NFT to Benefit American Nurses Foundation – article by WWD Media
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@LUKSO – Twitter
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LUKSO – Discord
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@TheDematerialised – Instagram
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iTunes – Edge of NFT Podcast
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@EdgeOfNFT – Twitter
About Marjorie Hernandez
Marjorie is a multi-faceted innovation and product expert, equal parts entrepreneur and designer. The Caracas-born trained architect, strategist and innovation consultant, built and led EY’s Innovation Lab in Berlin, before founding LUKSO.
Marjorie worked in Art Direction across Europe, before establishing herself as a Brand Strategist for Swiss and German brands. She created and managed EY’s Digital Innovation Lab, as a Digital Transformation and Strategy Executive, where she worked closely on Ethereum and with the IOTA Foundation.